Intergovernmental collaboration, a renewed public dialogue and removing barriers to private investment are the key improvements needed for city planning, a CEDA audience has heard at a recent event in Sydney.

With Australian cities containing 75 per cent of Australian jobs, and producing 80 per cent of our GDP, and growing - we need to act now COAG Reform Council, Chairman, Paul McClintock AO told the audience.

"While our expectations of our standard of living will only continue to rise as a community, we really can't afford to be naive about the fact that our standard of living is linked closely to the productivity of our nation, and the role that capital cities play in that equation is crucial," he said.

"We need to act now to ensure our cities can continue to support us into the future and are able to adapt to the changes in technology and transforming global economy."

Mr McClintock said the COAG Capital Cities Review "gives governments an unprecedented opportunity to ...cherry pick ideas from the processes and systems that are happening in other places".

The report also supports the belief that just meeting requirements and a bare minimum criteria is not good enough, he said.

And while comparisons across cities is not an entirely meaningful exercise "a little bit of healthy competitive comparison probably does no harm," he said.

Mr McClintock said the difference between a poor system and good system was political focus and drive.

"If you have a good system that's well thought through and structured, the key different factor between it being really good and fairly ordinary is a very small number of people at the top of it, who feel passionately about it and drive it consistently," he said.

He said the COAG Capital Cities Review found that none of the planning systems reviewed are fully consistent with the criteria and that no one government or level of government has the answers to city planning, nor the ability to achieve their goals in isolation.

"Managing our cities is complex so collaboration, both in and between governments is not just a nicety it is a necessity," he said.

He said that while governments are good at making long-term plans, the weak link is largely in implementation and in getting results. He said governments can do more, including:

• Improving the quality and sharing of information and data available, and using this as a basis for evidence based policy intervention in cities;
• Increasing engagement with community, business and stakeholders because you cannot get people to accept change if they don't understand why it's a priority; and
• Developing policy settings which encourage investment and innovation in our cities by the private sector because the cost of keeping them out is huge.

While the governments did seem to understand demand issues underlying their plans to measure future needs, "no system looked closely enough or early enough at the viability of their plans in economic terms," he said.

On Sydney, Mr McClintock said: "The system ... contains strong planning and content but lacks a robust accountability, performance and implementation measures, which are necessary to support them."

Infrastructure NSW, Chairman, the Hon. Nick Greiner AC said the reality is you either divide responsibility between the states and Canberra or, if you don't, you need intergovernmental collaboration.

Mr Greiner said that while it is obvious that silos are not good, "intergovernmental collaboration is somewhere between the bleeding obvious and the bloody impossible".

"We hope and expect that they actually will use common assumptions, they will talk to each and whilst they don't have to agree on every particular ... there is at least a consistency of intellectual approach," he said.

The problem in all of these areas is you have multi-factors, but we need accountability of the public interest, rather than interest of a single department, whether national or state, he said.

On NSW, Mr Greiner said that while "it is very difficult to have a single streamlined approach to investment applications" the process is "not yet remotely good enough".

Representing close to 30 per cent of the economic activity of the nation "getting Sydney right is a matter of national importance, not just of importance to people who live here, or to tax payers here in NSW," he said.

Mr Greiner agreed with COAG Reform Council's findings that Sydney "ought to do better on integration, on prioritising infrastructure, a long-term plan at Port Botany and the airport in particular, intergovernmental collaboration, evaluation and reporting."

Mr Greiner said he is also concerned about the language in public debate.

We must be sensitive to the language of the debate and be willing to have the debate, which is currently avoided, he said.

"I think the political debate lags reality and lags the marketplace," he said.

"The real question is how do you better develop the capacity for people to live and work in the existing areas which of course reduces the burden on infrastructure in the sense that infrastructure is already there or partly there."

KPMG, Director, Government Advisory Services Group, Paul Low said the real challenge of planning cities lies in the relationship between state and local government.

"That's where the real political tension comes - at the community level."

"That interlocking and that relationship between state and local government is fundamental if we are going to achieve those strategic outcomes"

"(In addition) we are not going to achieve the strategic outcomes of our cities if we don't have the regulatory underpinnings right."

"More effective interface between strategic and statutory planning, the alignment and appropriate recalibration of regulatory settings is critical."

On the issue of housing affordability Mr Low said that while it drives a lot of the policy debate, the debate is narrow. It needs to expand beyond the cost of getting a home to include affordable living; the cost of getting to and from work and the social impact of this travel, he said.

"They're the real issues that need to be focused on in terms of the strategic outcomes for the cities," he said.

"More than 30 per cent of your income is spent on issues that relate to where you live and work."

Mr Low recommended that COAG and the Commonwealth Government: "Take the work of the COAG Reform Council and the Productivity Commission's report together and look for solutions."

Committee for Sydney, Strategic Advisor, Dr Tim Williams said: "Sydney appears to have a governance gap like I have never seen for a metropolitan city."

Dr Williams said that while Melbourne has increased its share of GDP in the last decade, Sydney slipped from 27 to maybe 17 per cent. In addition Sydney has been approving 43 plans for every 10,000 people while Melbourne and Brisbane have been approving 106 and 103 respectively.

Dr Williams also canvassed some issues including housing affordability, liveability and investment barriers.

"Inheritance is becoming the main access route to (home) ownership in Sydney," he said.

Seventy per cent of Sydney-siders aged 35 and below cannot access home ownership while 22 per cent of all Australians own 55 per cent of property, he said.

In addition the balance of the city is a massive issue for Sydney, he said.

"Half of the population of Sydney now lives west of Parramatta... but only a third of jobs in Sydney are west of Parramatta, which explains an awful lot of the transport and other issues," he said.

"Forty per cent of people in Sydney are travelling 40 minutes each way to work and 23 per cent are travelling 60 minutes each way to work.

"Politicians need to set housing as a top priority and we need a new civic dialogue in Sydney around why growth is beneficial."

There is also an agency gap in Sydney and "politicians need to try and understand the nature of the industry and the kinds of de-risking that needs to be taken in order to liberate supply," he said.

"The risk to the private developers is so significant in this city (Sydney) is that there needs to be de-risking initiatives," he said.

On 2 April, COAG Reform Council (CRC) released their review of planning systems for Australia's capital cities. Click here to read the report.

CEDA and CRC jointly hosted a series of discussion forums across three cities to provide stakeholders with the opportunity to discuss the recommendations.

Adelaide, 20 April
Sydney, 27 April
Melbourne, 4 May